Arnold: Budget May Not Be Signed During My Term

By JEFF WILSON
|  Monday, Jul 26, 2010  |  Updated 5:56 PM PDT
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Gov. Arnold Schwarzenegger

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Without a budget resolution in sight, Gov. Arnold Schwarzenegger hinted Monday that he might not sign a budget before he leaves office next January unless he gets the reforms he wants.

California faces a $19 billion deficit for the fiscal year that began July 1, and Schwarzenegger is demanding pension, tax and spending reforms in the new budget. He said that if the Legislature doesn't give him a budget that meets his expectations, he won't act on it.

"If I don't get what I need, I will not sign it and it could drag on to the next governor," Schwarzenegger told reporters after meeting with the Los Angeles Area Chamber of Commerce on Monday.

QUESTION:  You expect it to take two weeks before we have a budget deal. Is that overly optimistic?
 
GOVERNOR SCHWARZENEGGER:  I would say that we are still weeks away from a budget agreement simply because the work that needs to go into the pension reforms and the work that needs to go in to the budget reform and tax reform still is not all complete. And as soon as that is complete and done -- and that, I think alone, will take at least two weeks -- so I think then it will take another week to really have the debates in Sacramento and get a vote. So I would say it can still be some time.
 
And if I don’t get all of the things that we need in order to be fiscally responsible and to make the changes, the tax reforms, the budget reforms and the pension reforms, I will not sign a budget and it could actually drag out until the next governor gets into office.

Schwarzenegger also told the chamber that he opposes a ballot initiative in November to pass a budget with a simple majority vote of the state Legislature, rather than the current two-thirds majority.

Earlier this month, the Field Poll found that 65 percent of voters favor Proposition 25, which backers say would make it easier for lawmakers to pass a budget.

The governor, a moderate Republican, said allowing passage of a budget by simple majority vote would give too much power to the dominant party in the Legislature.

"One party will make all the decisions," Schwarzenegger said.

California isn't facing a cash crisis as severe in the past, but without a budget the state will start to have trouble meeting its obligations.

According to the state controller's office, California will have enough cash for the month of August. After that, the state has to delay payments to schools and local governments and possibly issue IOUs again.

The governor on Monday tried to stress the severity of the state's financial problems as California entered its fourth week of the new fiscal year without a balanced budget. For weeks, there have been no signs of progress of a compromise.

Democrats, who control a majority of the Legislature, want to delay corporate tax breaks and impose a new oil tax. But Schwarzenegger and Republican lawmakers remain adamantly opposed to new taxes.

"I don't want to hand this burden and this problem to the next governor, but there is serious work to do," Schwarzenegger said.
 

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